Innovation as an internationalisation determinant of Brazilian technology-based SMEs

The general objective of this article is to analyse innovation as a determinant of the internationalisation patterns of Brazilian technology-based SMEs (small and medium enterprises) in different sectors and with different technological features. The theoretical background of this article centres on the typologies of innovation, SMEs’ internationalisation patterns, and innovation as an internationalisation determinant. The main theoretical contributions of this qualitative study are its analysis of innovation of the firm, focusing on the type of innovation, the degree of novelty, and the degree of control over the innovation process as determinants of their internationalisation patterns, and the influence of the external organisational environment on innovation and internationalisation. In terms of managerial implications, we highlight the effect of these factors on the competitiveness of case firms in international markets. Finally, our suggestions for future studies include the need for research replication in other emerging markets, the inclusion of both mature and young technology-based SMEs in the sample, the use of longitudinal data for case studies, and the validation of this qualitative study through a quantitative study that includes a larger sample of technology-based SMEs.

     

Human capital and SME internationalization: a structural equation modeling study

This study uses a structural equation modeling technique to predict the internationalization of small and medium‐sized enterprises (SMEs) from the entrepreneur's human capital (dimensions: international business skills, international orientation, environmental perception, and management know‐how). While international orientation and environmental risk perception predicted internationalization, international business skills and management know‐how did not. The implications of these findings for research and practice are discussed. Copyright © 2007 ASAC. Published by John Wiley & Sons, Ltd.     

Determinants of SME International Marketing Communications

ABSTRACT

This research article discusses the factors affecting international marketing communications in small- and medium-size enterprises (SMEs). International commitment and brand adaptation in overseas markets were found significantly influencing the effectiveness of international marketing communications. The results suggest that international marketers need to have resources input, such as human and financial, to drive international marketing communications. Brand adaptation also needs to be performed in order to achieve a better international marketing communications. There are two factors affecting international marketing communications suggesting international marketers of SMEs need to be concerned with both internal resource and external factors in international ventures.     

中小企业如何识别国际市场机会──基于偏离-份额分析法的机会分析与评估

中国中小企业经历一段高速发展之后,出口竞争力有所弱化。再加上世界金融危机的影响,企业的生存和发展存在困难。如何帮助中小企业更好地识别国际市场机会、提高竞争力,是国际市场营销研究者应该关注的问题。本文应用偏离-份额分析法(Shift-Share Method,缩写成SSM),对国际市场潜力进行分析和评估。为了更好地说明SSM的应用,本文选取了2004-2008年南美国家从中国进口工艺陶瓷制品的数据,进行了市场潜力的分析和评估。     

Marketing in Chinese Small and Medium Enterprises (SMEs): The State of the Art in a Chinese Socialist Economy

This paper adopts the context-embedded approach to examine the marketing practices of 307 small and medium enterprises (SMEs) in the People’’s Republic of China by comparing the survey findings with that of Hong Kong and Guangdong SMEs. Chinese SMEs focus on regional markets to avoid direct competition with Hong Kong SMEs in the international markets and also their Guangdong counterparts in the turbulent nationwide market. To market their own brands, Chinese SMEs have to analyze the market and use superior marketing strategies in the competitive markets. Chinese SMEs do not attain the superior competitive positions as that of their Guangdong counterparts, but they use customer satisfaction surveys and claims investigation to help develop excellence in product performance. Also, Chinese SMEs have to provide value-added products and services and also a well-rounded marketing competitive strategy to gain market shares. The traditional state-owned enterprise structure in China facilitates the development of hierarchical organizational structure and joint decision making process. Thus, care should be taken in assuming that marketing tools and techniques are equally applicable across all places, even in similar cultural contexts. Socio-cultural influences and mediating environmental factors should be considered when attempting to understand the marketing practices of Chinese small firms, specifically when China is in transition to a socialist market economy.     

中国中小企业进入全球营销的模式选择

中国中小企业参与全球营销从趋势上看将是必然选择,虽然目前无论是数量上还是质量上都不可观。本文首先说明中国中小企业完全可以同国内外大企业一样平等参与全球营销;然后针对中国中小企业的不同情况,分别阐述了中国中小企业应该如何选择适合自己的全球营销进入模式。     

Exploration of Chinese SMEs' export development: The role of managerial determinants based on an adapted innovation‐related internationalization model

Over the past two decades, small to medium‐sized enterprises (SMEs) in China have achieved rapid international development. Due to China's unique cultural and institutional environments, our understanding of the influence of managerial determinants on internationalization is still limited. This exploratory study takes the lens of the innovation model of internationalization to revisit the dynamic development of Chinese SMEs' export operations. Based on the four in‐depth case studies, the findings suggest that exports by Chinese SMEs are influenced by managerial perceptions such as negative country‐of‐origin effect and strict overseas quality standards. In addition, they show that both external and internal drivers act as “change agents” in their internationalization involvement. These findings will assist various stakeholders—government and export promotion agencies—to develop and deliver needs‐based supports and encourage nonexporters to participate in international operations.     

International Opportunity Recognition among Small and Medium‐Sized Family Firms*

Current research in the field of entrepreneurship emphasizes the importance of opportunity recognition as a key element in the entrepreneurial process. It has been recognized that network ties, activeness and alertness, and prior knowledge are related to how entrepreneurs recognize new opportunities. However, it is unclear how important these factors are when a firm explores opportunities for entry into a foreign market. In this exploratory case study, covering the international opportunity recognition of eight family‐owned small and medium‐sized enterprises (SMEs), we found that the firms in question mainly recognized international opportunities by establishing new formal ties rather than using existing informal or family ties. The findings also indicated that due to the small size and the flexibility of the management team in family SMEs, these firms were able to react quickly to new international opportunities. However, there was no direct relationship between the prior knowledge of the firms and their international opportunity recognition. In addition, we found that trade exhibitions formed the primary context for the international opportunity recognition of the SMEs in this study. These findings motivate a set of five propositions that may lead to further studies on this topic.     

Trade promotion and SME export performance

In this paper, we attempt to further develop an international resource-based view of small and medium-sized enterprises (SMEs) by examining the effectiveness of a set of export promotion services. Specifically, we investigate the impact of US state-sponsored export promotion activities on the international marketing efforts of small to medium-sized enterprises. We hypothesize and find that, even after controlling for internal firm resources, the use of trade shows and programs identifying agents and distributors contribute positively to SME satisfaction with export performance. Managerial implications are discussed.     

Pay‐for‐Performance,Employee Participation,and SME Performance

This study examines how pay‐for‐performance (PFP) systems affect the performance of small‐ and medium‐sized enterprises (SMEs). We decompose PFP into two dimensions: scope and depth. PFP scope captures the variety of performance measures and reward types included in a firm's PFP system, and PFP depth reflects the relative amount of performance‐based pay compared with total pay. We posit that PFP scope has a positive whereas PFP depth has an inverted U‐shaped effect on employee participation, which in turn enhances SME performance. Analysis of data collected at both employee and firm levels of 444 SMEs during 1999–2006 supported these hypotheses.     

China goes global: public policies' influence on small- and medium-sized enterprises' international expansion

Despite small- and medium-sized enterprises' (SMEs) significant contribution to China's social and economic development, very little has been written about the influence that public policies (i.e. public funding priorities and regulatory measures) may have on the first stage of international expansion of Chinese SMEs. To help fill this gap, the article analyses five main factors related to public policies and services affecting Chinese SMEs' internationalization: access to public financial resources; participation of the government in ownership; access to public procurement contracts; adverse regulatory and inconsistent legal frameworks; and public assistance on information and knowledge about markets. The main conclusion is that SMEs appear to base their international expansion on private capabilities, rather than on support from the government; in addition, the perceived barriers for the international expansion of these firms may be mainly internal, rather than institutional.     

Dismantling institutional complexity behind international competitiveness of emerging market firms

The paper examines the perceived role of emerging market institutions in the creation of firm‐specific advantages of local small‐ and medium‐sized enterprises (SMEs) supporting international expansion and competitiveness. Our objective is to deepen conceptual understanding of the complex link between emerging market institutional factors and an ability of emerging market SMEs to compete internationally. Our empirical evidence from Russian software SMEs operating in global niche markets reveals that managers perceive institutional influence on their firms' ability to compete internationally in a number of direct and indirect means. We find that, in addition to the well acknowledged negative impact of institutions, there are supportive and triggering forces that incentivize SMEs' international expansion and development of competitive advantages. We contribute to the literature by elaborating about the complexity of institutional influence on international competitiveness of emerging market SMEs. This research offers insights for managers about the prospects of international expansion of SMEs from emerging markets.     

An Investigation of Entrepreneurial Orientation,Perceived Environmental Hostility,and Strategy Application among Chinese SMEs

Little is known about how Chinese small and medium‐sized enterprises (SMEs) respond to their competitive environment. We predict that when industry competition is intense, entrepreneurial Chinese SMEs tend to perceive more environmental hostility than do their nonentrepreneurial peers. The perceived environmental hostility further drives these firms to choose marketing strategies but not cost control or innovation strategies. Data from 170 Chinese SMEs confirm our hypotheses, indicating that though some entrepreneurial orientation (EO) effects transcend different economy types, other EO effects differ significantly as the environment changes.     

The Internet and Internationalization of Smaller Manufacturing Enterprises

Abstract

One of the most frequently discussed topics in the current international business literature is the impact of the Internet on the internationalization of smaller manufacturing enterprises (SMEs). The study was carried out through a mail survey of the top executives of 125 Wisconsin firms. It examined 10 research hypotheses on internal and external factors which had been identified by previous research to influence the internationalization of SMEs through the Internet. Research findings conclude that the scope of internationalization of SMEs through the Internet is affected by internal factors, such as managements' perceptions of the effectiveness of their web sites as a marketing tool, lack of experience, and SMEs' potential usage of the Internet.     

Sources of opportunities used by growth minded owner managers of small and medium sized enterprises

The purpose of this paper is to investigate the sources and nature of opportunities used by owner-managers of small and medium size (SMEs) firms in order to grow their businesses. In addition to the owner-manager's desire for growth, clearly there needs to be both opportunities to pursue and sufficient management activities that will discover such opportunities, so that a business can grow. These opportunities may originate through some form of environmental change such as advances in technology or by exploiting changes in the marketplace, for example, the exit of a competitor.Research was carried out within twenty SMEs whose owner-manager's aimed to grow their businesses. The focus of the research was on the sources of opportunities they encountered and how and why opportunities were recognized by these firms.The key findings of this research illustrate that the majority of sources for business opportunities for SMEs in this study lie in the market place and are not a direct consequence of environmental change. Traditional marketing analysis tools can, therefore, identify significant sources and scope for growth opportunities for SMEs.     

Internationally leading SMEs vs. internationalized SMEs: Evidence of success factors from South Korea

Previous studies on the internationalization of small and medium-sized enterprises (SMEs) have typically compared the performance of internationalized SMEs (I-SMEs) with that of non-internationalized SMEs. However, not all I-SMEs can successfully lead the international market either unless they should consistently strive to attain and maintain competitive advantages. Thus, this study aims at identifying success factors which influence efforts of I-SMEs to lead international markets as internationally leading SMEs (IL-SMEs). To examine the success factors of the IL-SMEs, in this paper, IL-SMEs are specifically defined as I-SMEs which occupy dominant positions in the international market, i.e., ranking among the top three worldwide. The results based on a sample of 88 South Korean SMEs including 18 IL-SMEs and 70 I-SMEs indicate that 18 factors (out of 47 factors) show significant differences between IL-SEMs and I-SMEs in terms of customer relations/service, technological innovation, and corporate strategies. Also, by factor analysis and logistic regression analysis, three factors influencing the success of IL-SMEs are identified in the perspectives of technological innovation (R&D) and international marketing (customer satisfaction and demand quality/scope). Surprisingly, internationalization strategies and external markets have no relationship with performance of IL-SMEs. These results provide important implications to policy-makers interested in the sustainably international competitiveness of SMEs.     

Behavioral credit scoring model for technology-based firms that considers uncertain financial ratios obtained from relationship banking

The Korea government offers technology credit guarantee service to many technology-based small and medium enterprises (SMEs) suffering from funding problems. Many advanced application credit scoring models have been developed based on technology to reduce the high default rates of this service. However, a credit scoring model which can reflect changes in firms after a loan has been granted has not yet been developed. In the study reported here, we propose a behavioral credit scoring model that reflects the debt-paying ability of recipient firms, which is observed as a time series of financial ratios of firms via the relationship banking activities. We utilize this time series, as well as missing patterns of financial information, as additional predictors of loan defaults. We compare our proposed behavioral credit scoring models, fitted at different points of elapsed time, to the application credit scoring model. Finally, we suggest the best behavioral credit scoring model for technology-based SMEs. Our study can contribute to the reduction of the risk involved in credit funding for technology-based SMEs.     

Linking Processes and Dynamic Capabilities of International SMEs: The Mediating Effect of International Entrepreneurial Orientation

Previous research on the internationalization of small and medium‐sized enterprises (SMEs) has highlighted the role of knowledge and learning about foreign markets. However, empirical results on the performance implications of foreign market scanning and planning have been mixed. Following the dynamic capability perspective, we argue that SMEs can capitalize on scanning and planning processes because of their international entrepreneurial orientation. We test our hypotheses with a sample of 604 established SMEs and find that entrepreneurial orientation completely mediates the relationship between scanning and planning and international performance. Moreover, the results implicate a bidirectional relationship between processes and international entrepreneurial orientation.     

Institutional pressures and international market orientation in SMEs: Insights from the French wine industry

In this research, we examine how external institutional pressures influence international market orientation (IMO) in small-medium sized enterprises (SMEs). We use institutional theory and insights from the international entrepreneurship literature to predict how different formal regulative pressures (from national and international sources) as well as different informal normative pressures (from distributors and end-consumers) influence IMO in SMEs. We test our hypotheses using survey data from 107 small wineries across all of the main wine-producing regions in France. The results provide support to the central assertion that it is outside pressures on decision-making – rather than an endowment of internal resources and capabilities – that influence IMO in SMEs. External regulative sources have the strongest effects with pressures on decision-making from national laws having a negative impact on IMO and those from international laws having a positive impact on IMO. We find partial support for the effect of normative pressures from distributors and end-consumers. Implications for theory and management of internationalization in small firms are discussed.     

The Performance Advantages for SMEs of Product Innovation and Marketing Resource–Capability Complementarity in Emerging Economies

This study argues that small and medium‐sized enterprises (SMEs) must possess both resources and capabilities at a superior level, and those resources and capabilities must be complementary with one another to achieve superior financial performance. The resources and capabilities of interest are product innovation and marketing. Using data from manufacturing SMEs, the results suggest that product innovation resource–capability complementarity, marketing resource–capability complementarity, and their interaction are positively related to financial performance through product innovation and customer performance. The findings suggest that some SMEs may outperform others not only because they possess a specific individual resource–capability complementarity but also because they create synergy and asset interconnectedness.